Chuck E. Cheese Reopens With No Mouse, Seeks To Draw Adults

FAIRFAX CITY, VA — Chuck E. Cheese, the popular children's themed restaurant, has reopened the doors at many of its locations across the country for families that want to dine in and play video arcade games. But the coronavirus crisis is forcing the restaurant and entertainment chain, with a famous mouse mascot, to hold off on allowing birthday parties and other special events at its locations.

The Irving, Texas-based restaurant chain filed for bankruptcy on June 24 due to financial strains from the coronavirus crisis and is now developing new ways to position the company for success during the crisis and once the pandemic eases. Chuck E. Cheese is closely monitoring when it can open its doors to parties. But the company, which reported more than $900 million in revenue in 2019, also is looking at diversifying into online products, apps, home delivery and menu items that cater to adults.

"We're not having parties right now. Chuck E. is still resting," David McKillips, CEO of Chuck E. Cheese parent company CEC Entertainment Inc., told Patch in an interview at the restaurant's location in Fairfax City. "We're a high touch entertainment space. We're not a traditional restaurant."

Before Chuck E. Cheese opens in locations across the country, the company looks at local and state government standards and Centers for Disease Control and Prevention guidelines and solicits advice from epidemiologists. At all of its restaurants, Chuck. E. Cheese employees take the temperature of every customer. Everyone inside the restaurant wears a mask and staff members clean surfaces every 30 minutes, including both restrooms and game rooms.

The company also conducts customer sentiment studies. "If our consumers say, 'Hey, we're not ready to come back,' we're not going to open our doors," McKillips said.

As part of its Chapter 11 bankruptcy protection process, Chuck E. Cheese is negotiating leases with its landlords. "We want to keep as many Chuck E. Cheese's open as possible, hire back our people and bring our guests back," he said.

All of its restaurants in Northern Virginia are now open for indoor dining and game-playing. Chuck E. Cheese did close its location in Fredericksburg permanently. "That was for strategic business reason," McKillips explained. "But we have no plans right now to close any other stores."

In response to the coronavirus crisis, Chuck E. Cheese is working on a financial model for the future that allows the company to grow in many ways. "We certainly need life to come back to normal for Chuck E. Cheese to really flourish because we're an entertainment destination," he said.

In the meantime, though, Chuck E. Cheese is looking to pivot its business into other areas. Its restaurants will continue to push its meal carryout and deliveries. For young children, the company has developed birthday packages that it can deliver to homes. Children also can see Chuck E. Cheese on YouTube Kids and download game play apps. The games are integrated with local restaurants where families can visit to redeem their tickets that they have won.

Chuck E. Cheese is also working on launching a licensing and media division. "If you think about Chuck E. Cheese, we ought to have animation. We ought to have a movie. We ought to have toys and games and books," McKillips said.

"This is an incredibly popular character," he said, referring to Chuck E., the company's mouse mascot. The consumer appeal scores of the character, according to McKillips, are as high as Spider-Man and Barbie.

In a move to appeal to adults, Chuck E. Cheese recently launched Pasqually's Pizza, a delivery-only premium pizza brand operating from Chuck E. Cheese kitchens. "We just launched it to cater to your traditional delivery pizza customer," McKillips said.

McKillips, who was appointed CEO in late January, had been head of Chuck E. Cheese for just over a month when the coronavirus pandemic hit. Prior to joining Chuck E. Cheese, he worked for Six Flags Entertainment Corp. for 13 years, most recently as president of its international development company.

Over the last two days, McKillips has been visiting Chuck E. Cheese restaurants in the Mid-Atlantic and holding town hall meetings with employees to answer questions about the bankruptcy process, safety protocols, and diversity and inclusion.

In these town halls, McKillips said many employees have thanked him for the strict safety protocols at Chuck E. Cheese restaurants. Customers also have expressed their appreciation for the safety measures, telling store managers that they feel comfortable bringing their families to eat and play games.

"We're going to get through the short-term challenges and we have tremendous room for growth not only in Northern Virginia, but in the U.S. and across the world," he said. "But we need to be patient. We need to be safe."